Currency Market Analysis

May 15, 2017 | Currency Market Analysis

Global Themes

Greenback hit after poor US inflation; Chinese data today’s risk

The USDSGD fell to one-week lows after a series of poor economic results from the United States.

US core consumer price inflation was reported at 0.1% (below the 0.2% expected) while core retail sales were 0.4% (below the 0.6% expected).

While these numbers were disappointing, most analysts believe the US Federal Reserve will still raise US interest rates when it meets on 15 June.

The USDSGD fell 0.3% on Friday.

Mixed markets

Other key FX markets were mixed.

The euro was strongly higher after German economic growth numbers continued to show improvement. The EURSGD climbed 0.5%.

The Japanese yen was also stronger as the greenback’s weakness boosted the appeal of the JPY.

The British pound was weaker as markets continued to sell the UK’s currency after last week’s negative statement from the Bank of England.

Chinese data

Today’s major release comes from China.

Chinese industrial production, along with retail sales and investment numbers, should drive trade when released at 10.00am.

A recent weakening in Chinese data could drive a disappointing result.

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